《直觉外科Intuitive Surgical（ISRG）2024年年度报告「NASDAQ」（英文版）（144页）.pdf》由会员分享，可在线阅读，更多相关《直觉外科Intuitive Surgical（ISRG）2024年年度报告「NASDAQ」（英文版）（144页）.pdf（144页珍藏版）》请在三个皮匠报告上搜索。

1、Annual Report2024Intuitive Annual Report 2024Dear Owner,Id like to start this years note to you by stepping back and examining what motivates our teams at Intuitive.Despite decades of progress in disease diagnostics and treatments,the need for improvement in disease management is substantial.Three s

2、imple examples,among dozens,make the point:The average time a detectable lung cancer goes undiagnosed is more than a year.Lung cancer treatment course and survival is highly correlated to its stage,and delays in diagnosis increase the likelihood of bad outcomes for patients and increased costs for t

3、he healthcare system.In gynecologic health,women suffer with the symptoms of endometriosis,on average,for more than five years before definitive diagnosis and even longer before treatment.For patients needing mitral valve repair,the one-year mortality rate is nearly 7%.In example after example,we se

4、e long diagnostic journeys and treatments that are hard on patients.I find the statistics above disturbing,and I suspect you do too.Those of us in healthcare must do better.This reality motivates our mission and vision:We believe that minimally invasive care is life-enhancing care.Through ingenuity

5、and intelligent technology,we expand the potential of physicians to heal without constraints.We envision a future of care that is less invasive and profoundly better,where diseases are identified early and treated quickly so patients can get back to what matters most.1 yearFrom first recorded sympto

6、m to lung cancer diagnosis.5 yearsMean diagnostic delay for endometriosis worldwide.7%Overall 1-year mortality rate after mitral valve repair.Todays state of advanced diagnostics and care globallyIntuitive Annual Report 2024We view ourselves as solutions providers for some of the tough problems in a

7、dvanced intervention and surgery.Intuitives role is to bring the best technologies and the best people together to design and deliver technology-enabled ecosystems that improve these problems.We do this by aligning ourselves to the goals our customers care most about,the Quintuple Aim:better patient

8、 outcomes,better patient experience,better care team experience,lower total cost of care,and expanded access to care.Our teams work closely with hospitals,physicians,and care teams in this effort.We are disciplined in measuring our progress against the metrics our customers care most about,and our c

9、redibility is built on sharing this data directly with our customers and through peer review.A look back at 2024The past year was a strong one for Intuitive,with robust early adoption of our fifth-generation multiport platform,da Vinci 5,and healthy procedure growth in many supported indications glo

10、bally.Adoption of our Ion bronchoscopy platform and da Vinci SP single-port platform continued with new global clearances and increased utilization.In March 2024,we received 510(k)clearance to launch da Vinci 5 in the U.S.By year-end,we had placed 362 systems,with over 2,500 surgeons having performe

11、d more than 32,000 procedures on the new platform during its first phase of commercialization.Da Vinci 5 has broad clinical indicationsmore than 40 different procedure types have been performed using da Vinci 5 to date.We design our systems to routinely allow for sequential upgrades to their capabil

12、ity over time.Starting in 2025,as we move from our first phase of launch to broader global commercialization,da Vinci 5 customers will receive regular hardware and software upgrades,including for digital features supported by the platforms 10,000 x increase in computing power.Better outcomesLength o

13、f stayConsistency of outcomesSurgical site infectionsComplicationsReturn to ORReadmissionBetter patient experienceRecoveryConversionsOutpatient vs.inpatientBetter care team experienceErgonomicsDedicated teamsOR efficienciesAnalyticsTrainingLower total cost of careClinical costDirect costsClinical va

14、riationExpand access to careAccessEquitable quality careEducation and empowermentThe Quintuple AimIntuitive Annual Report 2024Highlights of the year include:Our customers used our products in nearly 2.7 million procedures in 2024,up 17%from 2023.Total cumulative experience on da Vinci platforms is n

15、ow nearly 17 million procedures.We placed 1,430 da Vinci multiport systems in 2024.Ion placements were 271,and da Vinci SP placements were 96 for the year.At year end,our total installed base of systems was more than 10,600,with da Vinci multiport over 9,600,Ion over 800,and da Vinci SP over 270.Our

16、 existing customers continue to rely on us.In 2024,we saw a 16%year-over-year increase in the number of integrated delivery networks(IDNs)that own 20 or more da Vinci systems,an indication they are committed to our team and our technology.Similarly,the number of hospital sites globally with seven or

17、 more da Vinci systems increased 63%year over year.Our 2024 revenue was approximately$8.35 billion,17%growth from 2023.Pro forma gross margin was 69.1%for 2024,compared with 68.1%for 2023.Recurring revenue accounted for 84%of our total revenues.At year end,we had approximately 15,600 full-time emplo

18、yeesover 2,000 of whom were engaged in research and development,over 7,000 in manufacturing operations,over 4,000 in commercial and service operations,with the balance in administrative activities.Our employees are based in 29 countries around the world.2,680,000+Procedures performed on da Vinci sys

19、tems in 202416,940,000+Procedures performed on da Vinci systems to date11,790+Intuitive systems placed in 202410,670+Intuitive systems in hospitals globally14,000+Peer-reviewed articles published in 202443,000+Peer-reviewed articles published to date295,000+Ion procedures performed in 2024180,000+Io

20、n procedures performed to date1,430+Multiport9,620+Multiport95+Single port270+Single port270+Ion800+Ion1.As of Dec.20242.As of Nov.2024Intuitive by the numbers in 2024Intuitive Annual Report 2024Each year,we experience challenges.In 2024 they included:Our progress in China was impacted by national e

21、conomic conditions and by competitive dynamics.GLP-1 medications continued to impact the prevalence of bariatric surgery.Surgery for obesity using da Vinci declined less than the overall bariatric surgery market,indicating continued surgeon and patient interest in da Vinci.The interaction between GL

22、P-1s and surgery as treatment options for obese patients continues to evolve,and we expect a combination of both pharmacology and surgery to remain important in the future.The capital environment in Europe was stressed in the UK in 2024 due to government policies for the deployment of capital and in

23、 Germany due to nationwide hospital consolidation.We expect these stresses to resolve over time.A large nationwide strike of young doctors in Korea that began in early 2024 removed a significant fraction of the workforce from large hospitals and reduced the total number of surgeries taking place.Des

24、pite this backdrop,surgeons in Korea increased their use of da Vinci through the year,in part because da Vinci surgeries decrease the required healthcare staffing per patient.Da Vinci programs helped Korean hospitals continue to deliver care in a difficult staffing environment.Intuitive Annual Repor

25、t 2024Looking to the futureWe are in the early stages of a decades-long opportunity to improve healthcare with our ecosystem and partners to transform patient diagnosis,treatment,and recovery.Two recent areas showing increased interest by our customers are after-hours surgery for emergent conditions

26、 and cardiac surgery.In the U.S.,after-hours acute surgery on Intuitive platforms increased by 33%in 2024.This growth is driven by surgeons commitment to provide outstanding careregardless of the time of day a patient needs the surgeryand by the increased availability of da Vinci systems and trained

27、 staff to use them.Studies of the positive impact of da Vinci surgery programs on improving access to high-quality minimally invasive surgery are now being published,supporting da Vinci systems role in improving access to less invasive care.For more than 25 years,surgeons have performed robotic-assi

28、sted cardiac procedures.We believe there is significant clinical value for these procedures,and we are working with a dedicated and passionate group of cardiac surgeons to offer more patients high-quality cardiac surgery.We believe that over time,our da Vinci 5 platform will provide important capabi

29、lities for cardiac surgeons and improve outcomes.Each year,we evaluate where our customers see significant need for improvement in the Quintuple Aim and where our current and future platforms and services can make a positive difference.In the past several years,innovations like da Vinci 5,Ion,and ne

30、w indications for da Vinci SP have increased the number of patients our customers can treat using our products.Combined with demographic trends in countries with aging populations,the number of patients that can benefit from our work continues to grow.201920202021202220232024(estimate)33%YoY growthA

31、fter-hours da Vinci proceduresU.S.Acute Care:Providers are working in the pursuit of health equityIntuitive Annual Report 2024Culture and customer focusI believe that great organizations focus relentlessly on their customers needs and experiences along with the culture of the company.At Intuitive,ou

32、r goal for our team members is for them to experience our organization as one that:Pursues an honorable,important,and durable mission that we truly work to fulfill.Is made up of staff and co-workers who are outstanding at their jobs and are great people.Expects each one of us to know how our work he

33、lps the customer and our company,and to understand how our work makes a tangible difference for them.We measure our customers experience with us through a J.D.Power survey,and 2024 showed strong results.This is particularly important to achieve during the year of a new system launch,where supply is

34、constrained and we learn,from our customers,the systems unique value inside and outside their operating rooms.Our teams applied learnings from prior launches and worked closely with customers to meet their needs.Likewise,we routinely assess our employees experience with us.In 2024,we were recognized

35、 in the Forbes Americas Best Companies 2025 list,which ranked Intuitive as the#1 healthcare company and#14 overall in the U.S.We are the beneficiaries of a talented,passionate,and dedicated staff globallywe are grateful for their efforts.202475Net promoter score(NPS)NPS ClassificationWorld class:70+

36、Excellent:50-69Good:0-50Intuitive world-class ranking by J.D.PowerIntuitive Annual Report 2024Gary Guthart,PhDChief Executive OfficerPriorities for 2025Looking to 2025,our priorities are these:We will focus on the full launch of da Vinci 5 in the U.S.and its clearances in key markets globally,as wel

37、l as follow-on features.We will pursue increased adoption of our focused procedures through clinical and evidentiary pathways,training,commercial activities,and market access efforts.We will drive continued progress in building industrial scale,product quality,and manufacturing optimization.We will

38、apply our focus to the availability of our digital tools and their excellence.In closing,thank you for putting your trust in our team and for your continued support as we work to make minimally invasive care profoundly better.UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON,D.C.20549 FORM 1

39、0-K(MARK ONE)ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the fiscal year ended December 31,2024 ORTRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d)OF THE SECURITIES EXCHANGE ACT OF 1934For the transition period from to Commission file number 000-30713Intuit

40、ive Surgical,Inc.(Exact name of Registrant as specified in its Charter)Delaware 77-0416458(State or Other Jurisdiction of Incorporation or Organization)(I.R.S.Employer Identification Number)1020 Kifer RoadSunnyvale,California 94086(Address of principal executive offices)(Zip Code)(408)523-2100(Regis

41、trants telephone number,including area code)Securities registered pursuant to Section 12(b)of the Act:Title of each classTrading Symbol(s)Name of each exchange on which registeredCommon Stock,par value$0.001 per shareISRGThe Nasdaq Global Select MarketSecurities registered pursuant to Section 12(g)o

42、f the Act:NoneIndicate by check mark if the registrant is a well-known seasoned issuer,as defined in Rule 405 of the Securities Act.Yes No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d)of the Act.Yes No Indicate by check mark whether

43、the registrant(1)has filed all reports required to be filed by Section 13 or 15(d)of the Securities Exchange Act of 1934 during the preceding 12 months(or for such shorter period that the registrant was required to file such reports),and(2)has been subject to such filing requirements for the past 90

44、 days.Yes No Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T(232.405 of this chapter)during the preceding 12 months(or for such shorter period that the registrant was required to su

45、bmit such files).Yes No Table of ContentsIndicate by check mark whether the registrant is a large accelerated filer,an accelerated filer,a non-accelerated filer,a smaller reporting company,or emerging growth company.See definition of“large accelerated filer,”“accelerated filer,”“smaller reporting co

46、mpany,”and“emerging growth company”in Rule 12b-2 of the Exchange Act.Large accelerated filerAccelerated filerNon-accelerated filerSmaller reporting companyEmerging growth companyIf an emerging growth company,indicate by check mark if the registrant has elected not to use the extended transition peri

47、od for complying with any new or revised financial accounting standards provided pursuant to Section 13(a)of the Exchange Act.Indicate by check mark whether the registrant has filed a report on and attestation to its managements assessment of the effectiveness of its internal control over financial

48、reporting under Section 404(b)of the Sarbanes-Oxley Act(15 U.S.C.7262(b)by the registered public accounting firm that prepared or issued its audit report.If securities are registered pursuant to Section 12(b)of the Act,indicate by check mark whether the financial statements of the registrant include

49、d in the filing reflect the correction of an error to previously issued financial statements.Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrants executive officers during t

50、he relevant recovery period pursuant to 240.10D-1(b).Indicate by check mark whether the registrant is a shell company(as defined in Rule 12b-2 of the Exchange Act).Yes No The aggregate market value of the voting and non-voting common equity held by non-affiliates on June 30,2024,based upon the closi

51、ng price of Common Stock on such date as reported on The Nasdaq Global Select Market,was approximately$157.3 billion.Shares of voting stock held by each officer and director have been excluded in that such persons may be deemed to be affiliates.This assumption regarding affiliate status is not neces

52、sarily a conclusive determination for other purposes.The number of outstanding shares of the registrants common stock as of January 27,2025,was 356,656,964.DOCUMENTS INCORPORATED BY REFERENCEPart III incorporates information by reference to the definitive proxy statement for the Companys Annual Meet

53、ing of Stockholders to be held on or about May 1,2025,to be filed within 120 days of the registrants fiscal year ended December 31,2024.Table of ContentsPage No.PART IItem 1.Business7Item 1A.Risk Factors27Item 1B.Unresolved Staff Comments58Item 1C.Cybersecurity58Item 2.Properties59Item 3.Legal Proce

54、edings59Item 4.Mine Safety Disclosures59PART IIItem 5.Market for Registrants Common Equity,Related Stockholder Matters,and Issuer Purchases of Equity Securities60Item 6.RESERVED61Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations62Item 7A.Quantitative and Qua

55、litative Disclosures About Market Risk87Item 8.Financial Statements and Supplementary Data88Item 9.Changes in and Disagreements with Accountants on Accounting and Financial Disclosure127Item 9A.Controls and Procedures127Item 9B.Other Information128Item 9C.Disclosure Regarding Foreign Jurisdictions t

56、hat Prevent Inspections128PART IIIItem 10.Directors,Executive Officers,and Corporate Governance129Item 11.Executive Compensation129Item 12.Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters129Item 13.Certain Relationships and Related Transactions and Direc

57、tor Independence129Item 14.Principal Accountant Fees and Services129PART IVItem 15.Exhibits and Financial Statement Schedules130Item 16.Form 10-K Summary132SIGNATURES133Table of ContentsINTUITIVE SURGICAL,INC.INDEX3CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTSThis report contains forward-look

58、ing statements within the meaning of Section 27A of the Securities Act of 1933,as amended,and Section 21E of the Securities Exchange Act of 1934,as amended.Forward-looking statements relate to expectations concerning matters that are not historical facts.Statements using words such as“estimates,”“pr

59、ojects,”“believes,”“anticipates,”“plans,”“expects,”“intends,”“may,”“will,”“could,”“should,”“would,”“targeted,”and similar words and expressions are intended to identify forward-looking statements.These forward-looking statements include,but are not limited to,statements related to future results of

60、operations,future financial condition,the expected impacts of COVID-19 on our business,financial condition,and results of operations,our financing plans and future capital requirements,our potential tax assets or liabilities,and statements based on current expectations,estimates,forecasts,and projec

61、tions about the economies and geographic markets in which we operate and our beliefs and assumptions regarding these economies and markets.These forward-looking statements are necessarily estimates reflecting the judgment of our management and involve a number of risks and uncertainties that could c

62、ause actual results to differ materially from those suggested by the forward-looking statements.These forward-looking statements should be considered in light of various important factors,including,but not limited to,the following:the overall macroeconomic environment,which may impact customer spend

63、ing and our costs,including tariffs,the levels of inflation,and interest rates;the conflict between Ukraine and Russia;conflicts in the Middle East;disruption to our supply chain,including difficulties in obtaining a sufficient supply of materials;curtailed or delayed capital spending by hospitals;t

64、he impact of global and regional economic and credit market conditions on healthcare spending;delays in obtaining new product approvals,clearances,or certifications from the Food and Drug Administration(“FDA”),comparable regulatory authorities,or notified bodies;the risk of our inability to comply w

65、ith complex FDA and other regulations,which may result in significant enforcement actions;regulatory approvals,clearances,certifications,and restrictions or any dispute that may occur with any regulatory body;healthcare reform legislation in the U.S.and its impact on hospital spending,reimbursement,

66、and fees levied on certain medical device revenues;changes in hospital admissions and actions by payers to limit or manage surgical procedures;the timing and success of product development and customer acceptance of developed products;the results of any collaborations,in-licensing arrangements,joint

67、 ventures,strategic alliances,or partnerships,including the joint venture with Shanghai Fosun Pharmaceutical(Group)Co.,Ltd.;our completion of and ability to successfully integrate acquisitions;intellectual property positions and litigation;risks associated with our operations and any expansion outsi

68、de of the U.S.;unanticipated manufacturing disruptions or the inability to meet demand for products;our reliance on sole-and single-sourced suppliers;the results of legal proceedings to which we are or may become a party;adverse publicity regarding us and the safety of our products and adequacy of t

69、raining;the impact of changes to tax legislation,guidance,and interpretations;changes in tariffs,trade barriers,and regulatory requirements(including potential new tariffs imposed by the current U.S.presidential administration on imports from Mexico,where we currently manufacture a significant major

70、ity of our instruments and accessories);and other risks and uncertainties,including those listed under the caption“Risk Factors.”Readers are cautioned not to place undue reliance on these forward-looking statements,which speak only as of the date of this report and which are based on current expecta

71、tions and are subject to risks,uncertainties,and assumptions that are difficult to predict.Our actual results may differ materially and adversely from those expressed in any forward-looking statement,and we undertake no obligation to publicly update or release any revisions to these forward-looking

72、statements,except as required by law.Additional risks are described throughout this report,particularly in Part I,“Item 1A.Risk Factors,”and include,but are not limited to,those summarized on the following pages.Table of Contents4RISKS RELATING TO OUR BUSINESSOur markets are highly competitive,and c

73、ustomers may choose to purchase our competitors products or services or may not accept robotic-assisted medical procedures,which could result in reduced revenue and loss of market share.We are subject to a variety of risks due to our operations outside of the U.S.We are subject to litigation,investi

74、gations,and other legal proceedings relating to our products,customers,competitors,and government regulators that could materially adversely affect our financial condition,divert managements attention,and harm our business.We offer usage-based arrangements,including alternative capital acquisition a

75、pproaches;as a result,we are exposed to an increased risk of losses of revenue and increased credit risk,which could adversely affect our business,financial condition,or results of operations.Our reliance on sole-and single-sourced suppliers and ability to purchase at acceptable prices a sufficient

76、supply of materials could harm our ability to meet product demand in a timely manner or within budget.New product developments and introductions may adversely affect our business,financial condition,or results of operations.We may encounter manufacturing problems or delays that could result in lost

77、revenue.We expect gross profit margins to vary over time,and changes in our gross profit margins could adversely affect our business,financial condition,or results of operations.Macroeconomic conditions could materially adversely affect our business,financial condition,or results of operations.Infor

78、mation technology system failures,cyberattacks,or deficiencies in our cybersecurity could harm our business,customer relations,financial condition,or results of operations.If our products do not achieve and maintain market acceptance,we will not be able to generate the revenue necessary to support o

79、ur business.If hospitals are unable to obtain coverage and reimbursement for procedures using our products,if reimbursement is insufficient to cover the costs of purchasing our products,or if limitations are imposed by governments on the amount hospitals can charge for certain procedures,we may be u

80、nable to generate sufficient sales to support our business.If our products contain defects or encounter performance problems,we may have to recall our products and our reputation may suffer.We utilize distributors for a portion of our sales and service of our products in certain countries,which subj

81、ects us to a number of risks that could harm our business,financial condition,or results of operations.The failure to attract and retain key personnel could harm our ability to compete,and changes in our existing labor relationships could materially adversely impact our business,financial condition,

82、or results of operations.Public health crises or epidemic diseases,or the perception of their effects,could materially adversely affect our business,financial condition,or results of operations.Negative publicity,whether accurate or inaccurate,concerning our products or our company could reduce mark

83、et acceptance of our products and could result in decreased product demand and reduced revenues.We could be subject to significant,uninsured losses,which may have a material adverse impact on our business,financial condition,or results of operations.We experience long and variable contracting cycles

84、 and seasonality in our business,which may cause fluctuations in our financial results.Third parties may offer to sell remanufactured or unauthorized instruments and accessories to our customers or provide unauthorized service on our systems,which could adversely impact safety,our financial results,

85、and our reputation.Our business is subject to complex and evolving laws and regulations regarding data privacy,data protection,artificial intelligence,and responsible use of data.Ongoing and future global conflicts could adversely affect our business,financial condition,or results of operations.Inco

86、rporating artificial intelligence technologies into our products,services,and operations may result in legal and regulatory risks or have other adverse consequences to our business,financial condition,or results of operations.Disruptions at the FDA and other government agencies or notified bodies co

87、uld hinder their ability to hire,retain,or deploy personnel,or otherwise prevent products from being developed,cleared,certified,approved,or commercialized in a timely manner or at all,which may adversely affect our business,financial condition,or results of operations.We may incur losses associated

88、 with currency fluctuations and may not be able to effectively hedge our exposure.If we do not successfully manage our collaboration,licensing,joint venture,strategic alliance,or partnership arrangements with third parties,we may not realize the expected benefits from such arrangements,which may hav

89、e a Table of Contents5material adverse effect on our business,financial condition,or results of operations.If we fail to successfully acquire or integrate new businesses,products,and technology,we may not realize expected benefits,or our business may be harmed.We are exposed to credit risk and fluct

90、uations in the market value of our investments.Changes in our effective tax rate may adversely affect our business,financial condition,or results of operations.We are subject to risks associated with real estate construction and development.Climate change,natural disasters,or other events beyond our

91、 control could disrupt our business,financial condition,or results of operations.Consolidation in the healthcare industry could have an adverse effect on our business,financial condition,or results of operations.We use estimates,make judgments,and apply certain methods in determining our financial r

92、esults and in measuring the progress of our business.As these estimates,judgments,and methods change,our results of operations and our assessment of the progress of our business could vary.RISKS RELATING TO OUR REGULATORY ENVIRONMENTComplying with FDA and foreign regulations is a complex process,and

93、 our failure to fully comply could subject us to significant enforcement actions.Our products are subject to a lengthy and uncertain domestic regulatory review process.If we do not obtain and maintain the necessary domestic regulatory authorizations,we will not be able to sell our products in the U.

94、S.Our products may cause or contribute to adverse medical events or be subject to failures or malfunctions that we are required to report to the FDA and foreign regulatory authorities and,if we fail to do so,we would be subject to sanctions that could harm our reputation,business,financial condition

95、,or results of operations.If our manufacturing facilities do not continue to meet federal,state,or other manufacturing regulations and standards,we may be required to temporarily cease all or part of our manufacturing operations,import/export of our products,and/or recall some products,which could r

96、esult in significant product delivery delays and lost revenue.Our products are subject to international regulatory processes and approval or certification requirements.If we do not obtain and maintain the necessary regulatory requirements,we will not be able to sell our products in other countries.C

97、hanges in healthcare legislation and policy may have an adverse effect on our business,financial condition,or results of operations.We are subject to federal,state,and foreign laws governing our business practices,which,if violated,could result in substantial penalties.Additionally,challenges to,or

98、investigation into,our practices could cause adverse publicity and be costly to respond to and,thus,could harm our business,financial condition,or results of operations.If hospitals and other surgical facilities do not continue to meet federal,state,or other regulatory standards,they may be required

99、 to temporarily cease all or part of their system utilization.RISKS RELATING TO OUR INTELLECTUAL PROPERTYIf we are unable to fully protect and successfully defend our intellectual property from use by third parties,our ability to compete in the market may be harmed.Others may be successful in assert

100、ing that our products infringe their intellectual property rights,which may cause us to pay substantial damages and/or enjoin us from commercializing our products.Our products may rely on licenses from third parties,which may not be available to us on commercially reasonable terms or at all.If we lo

101、se access to these technologies,our revenues could decline.GENERAL RISK FACTORSOur future operating results may be below expectations,which could cause our stock price to decline.Our stock price has been,and will likely continue to be,volatile.Changes to financial accounting standards may affect our

102、 reported results of operations.The summary of material risk factors described above should be read together with the text of the full risk factors below in the section entitled“Item 1A.Risk Factors”and the other information set forth in this Annual Report on Form 10-K,including our Consolidated Fin

103、ancial Statements and the related notes,as well as other documents that we file with the U.S.Securities and Exchange Commission.The risks summarized above or described in full below are not the only risks that we face.Additional risks and uncertainties not precisely known to us or that we currently

104、deem to be immaterial may also materially adversely affect our business,financial condition,or results of operations.Table of Contents6PART IITEM 1.BUSINESSIn this report,“Intuitive Surgical,”“Intuitive,”the“Company,”“we,”“us,”and“our”refer to Intuitive Surgical,Inc.and its wholly and majority-owned

105、 subsidiaries.Intuitive,Intuitive Surgical,da Vinci,da Vinci S,da Vinci Si,da Vinci X,da Vinci Xi,da Vinci 5,da Vinci SP,EndoWrist,Firefly,Flexision,Intuitive 3D Models,Intuitive Hub,Ion,My Intuitive,OnSite,SimNow,SureForm,and SynchroSeal are trademarks or registered trademarks of the Company.Compan

106、y BackgroundAs part of Intuitives mission,we believe that minimally invasive care is life-enhancing care.By combining ingenuity and intelligent technology,we expand the potential of physicians to heal without constraints.We envision a future of care that is less invasive and profoundly better,where

107、diseases are identified early and treated quickly so patients can get back to what matters most.Since our founding 30 years ago,we have been delivering on this mission and vision by combining innovative technology with clinical expertise to advance minimally invasive care.We do so by providing a com

108、prehensive ecosystem that includes robotic-assisted systems,instruments and accessories,customer learning,and support services all connected by a digital portfolio that enables actionable insights across the care continuum.Among other capabilities,these products and services can augment the skills a

109、nd improve the efficiency of clinicians and care teams while providing decision support and learning that can help deliver differentiated clinical and economic value for patients,providers,and payers when compared to the next best available treatment options.To assure continued alignment with the pa

110、tients and healthcare community we serve,we have adopted the Quintuple Aim as our“north star.”Starting foremost with a focus on patients,we seek to demonstrate that our products can deliver better outcomes that are validated by rigorous peer-reviewed evidence.Second,we aim to work with clinicians an

111、d care teams to create better patient experiences that enable patients to more quickly get back to what matters most in their lives,with fewer complications,less pain and discomfort,and greater predictability.Third,we aim to enable the care teams who use our platforms and technology-enabled ecosyste

112、m to have better experiences that augment their skills while reducing fatigue and increasing efficiency and reliability.Fourth,we aim to help lower the total cost of care per patient episode when compared with existing treatment alternatives,providing a return on investment for hospitals and healthc

113、are systems and value for payers.Lastly,we aim to expand access to high-quality minimally invasive care by partnering with hospitals,healthcare systems,and patient advocacy groups to address barriers to care.While surgery and acute interventions have improved significantly in the past few decades,th

114、ere remains a significant need to improve across all aspects of the Quintuple Aim.Stakeholders continue to expect better clinical outcomes and decreased variability of outcomes across clinicians and care teams.Globally,healthcare systems continue to be stressed and lacking in critical resources,incl

115、uding the professionals who staff care teams.At the same time,healthcare providers,payers,and governments strain to cover the healthcare needs of their populations and demand lower total cost per patient to treat disease.In the face of these challenges,we continue to believe that we are well-positio

116、ned to synthesize scientific and technological advances in biology,computing,imaging,algorithms,and robotics to deliver meaningful and measurable value to all of our stakeholders.ProductsSystemsAdvanced robotic systems provide precise,powerful platforms with high-performance vision,extending the car

117、e teams capabilities to enhance minimally invasive care.These systems include da Vinci surgical systems,which are designed to enable a wide range of surgical procedures using a minimally invasive approach,and the Ion endoluminal system,which extends our commercial offerings beyond surgery into diagn

118、ostic procedures,enabling minimally invasive biopsies in the lung.Da Vinci Surgical SystemsBy striving to find less invasive ways to enter the body,provide clearer views of anatomy and more precise tissue interactions,and help hone surgical skills,Intuitive launched its first da Vinci surgical syste

119、m in 1999.In 2000,the FDA cleared da Vinci for general laparoscopic surgery.Since then,we have received numerous additional indications within the U.S.as well as outside of the U.S.Refer to the section titled“Regulatory Activities”in our Managements Discussion and Analysis of Financial Condition and

120、 Results of Operations for more recent regulatory clearances,approvals,and certification.There are several models of the da Vinci surgical system currently used by our customers:our recently released fifth-generation da Vinci 5 surgical system,our fourth-generation da Vinci X,da Vinci Xi,and da Vinc

121、i SP surgical systems,our third-generation da Vinci Si surgical system,and our second-generation da Vinci S surgical system.The da Vinci surgical Table of Contents7systems are designed to enable surgeons to perform a wide range of surgical procedures within our targeted general surgery,urologic,gyne

122、cologic,cardiothoracic,and head and neck specialties.Da Vinci systems offer surgeons three-dimensional,high definition(“3DHD”)vision,a magnified view,and robotic and computer assistance.They use specialized instrumentation,including a miniaturized surgical camera(endoscope)and wristed instruments(e.

123、g.,scissors,scalpels,and forceps)that are designed to help with precise dissection and reconstruction deep inside the body.Our da Vinci surgical systems are comprised of the following components:Surgeon Console.The da Vinci surgical system allows surgeons to operate while comfortably seated at an er

124、gonomic console viewing a 3DHD image of the surgical field.The surgeons fingers grasp instrument controls below the display with the surgeons hands naturally positioned relative to his or her eyes.Using electronic hardware,software,algorithms,and mechanics,our technology translates the surgeons hand

125、 movements into precise and corresponding real-time micro movements of the da Vinci instruments positioned inside the patient.On most of our current systems(da Vinci 5,da Vinci X,da Vinci Xi,da Vinci SP,and da Vinci Si),a second surgeon console may be used in two ways:to provide assistance to the pr

126、imary surgeon during surgery or to act as an active aid during surgeon-proctor training sessions.With the da Vinci 5,da Vinci X,da Vinci Xi,da Vinci SP,and da Vinci Si,a surgeon sitting at a second console can view the same surgery as the primary surgeon and can be passed control of some or all of t

127、he da Vinci instruments during the surgery.In addition,surgeons can control 3D virtual pointers to augment the dual-surgeon experience.The da Vinci surgical system is designed to allow surgeons to operate while seated,which may be clinically advantageous because of reduced surgeon fatigue.The da Vin

128、ci surgical systems design provides natural hand-eye alignment at the surgeon console.Because the da Vinci surgical systems robotic arms hold the camera and instruments steady,there is less surgeon and assistant fatigue and enhanced control by the surgeon.Patient-Side Cart.The patient-side cart hold

129、s electromechanical arms that manipulate the instruments inside the patient.For our da Vinci 5,da Vinci X,da Vinci Xi,and da Vinci Si surgical systems,up to four arms attached to the cart can be positioned,as appropriate,and then locked into place.At least two arms hold surgical instruments,one repr

130、esenting the surgeons left hand and one representing the surgeons right hand.A third arm positions the endoscope,allowing the surgeon to easily move,zoom,and rotate the field of vision.A fourth instrument arm extends surgical capabilities by enabling the surgeon to add a third instrument to perform

131、additional tasks.The fourth instrument arm is a standard,integrated feature on the da Vinci 5,da Vinci X,da Vinci Xi,and da Vinci Si surgical systems.Our da Vinci single-port(“SP”)surgical system includes a single arm with three multi-jointed,wristed instruments and the first da Vinci fully wristed,

132、3DHD camera.The instruments and the camera all emerge through a single cannula and are triangulated around the target anatomy to avoid external instrument collisions that can occur in narrow surgical workspaces.3DHD Vision System.Our vision system includes a 3DHD endoscope with two independent visio

133、n channels linked to two separate color monitors through sophisticated image processing electronics and software.The resulting 3DHD image has high resolution,high contrast,low flicker,and low cross fading.A digital zoom feature in the 3DHD vision system allows surgeons to magnify the surgical field

134、of view without adjusting the endoscope position and,thereby,reduces interference between the endoscope and instruments.The 3DHD vision system is a standard,integrated feature on the da Vinci 5,da Vinci X,da Vinci Xi,da Vinci SP,da Vinci Si,and da Vinci S surgical systems.Firefly Fluorescence Imagin

135、g(“Firefly”).Firefly is a standard feature of the da Vinci 5,da Vinci X,da Vinci Xi,and da Vinci SP surgical systems and is available as an upgrade on our da Vinci Si surgical system.This imaging capability combines an injectable fluorescent dye with a specialized da Vinci camera head,endoscope,and

136、laser-based illuminator to allow surgeons to identify vasculature,tissue perfusion,or biliary ducts in three dimensions beneath tissue surfaces in real-time.The most common procedural categories for the use of Firefly are urology,gynecology,and general surgery.Da Vinci Integrated Table Motion.Integr

137、ated Table Motion coordinates the movements of the da Vinci robotic arms with an advanced operating room(“OR”)table,the TS 7000dV OR Table sold by Hillrom(now a part of Baxter International Inc.),to enable managing the patients position in real-time while the da Vinci robotic arms remain docked.This

138、 gives OR teams the capability to improve the positioning of the operating table during da Vinci surgical system procedures.Integrated Table Motion enables the patient to be dynamically positioned during the procedure.It enables surgeons to extend reach,facilitate access,and choose the angle of appr

139、oach to target anatomy,as well as reposition the table during the procedure to enhance anesthesiologists management of the patient.Integrated Table Motion is a standard feature for da Vinci 5 surgical systems and is available as an upgrade for da Vinci Xi surgical systems.Ion Endoluminal SystemIn 20

140、19,the FDA cleared our Ion endoluminal system,which is a flexible,robotic-assisted,catheter-based platform that utilizes instruments and accessories for which the first cleared indication is minimally invasive biopsies in the lung.Our Ion system extends our commercial offering beyond surgery into di

141、agnostic,endoluminal procedures.The system features an ultra-thin,ultra-maneuverable catheter that can articulate 180 degrees in all directions and allows navigation far into the peripheral Table of Contents8lung and provides the stability necessary for precision in a biopsy.Many suspicious lesions

142、found in the lung may be small and difficult to access,which can make diagnosis challenging,and Ion helps physicians obtain tissue samples from deep within the lung,which could help enable earlier diagnosis.Instruments and AccessoriesWe offer a comprehensive suite of stapling,energy,and core instrum

143、entation for our multi-port da Vinci surgical systems.Our technology is designed to transform the surgeons natural hand movements outside of the body into corresponding micro-movements inside the patients body and suture with precision,just as they can in open surgery.With our technology,a surgeon c

144、an also use“motion scaling,”a feature that translates,for example,a three-millimeter hand movement outside the patients body into a one-millimeter instrument movement in the surgical field inside the patients body.Motion scaling is designed to allow precision and control for delicate tasks.In additi

145、on,our technology filters the tremor inherent in a surgeons hands.Da Vinci Instruments.Most of the instruments that we manufacture incorporate wristed joints for natural dexterity and tips customized for various surgical procedures.Various da Vinci instrument tips include forceps,scissors,electrocau

146、tery tools,scalpels,and other surgical tools that are familiar to the surgeon from open surgery and conventional minimally invasive surgery(“MIS”).A variety of instruments may be selected and used interchangeably during a surgery.Most instruments are sterilizable at the hospital,while others are pro

147、vided sterile,and most are reusable for a defined number of procedures.A programmed memory chip inside each instrument performs several functions that help determine how the da Vinci system and instruments work together.In addition,the chip generally will not allow the instrument to be used for more

148、 than the prescribed number of procedures to help ensure that its performance meets specifications during each procedure.Da Vinci Stapling.The SureForm and EndoWrist staplers are wristed,stapling instruments intended for resection,transection,and creation of anastomoses.These instruments enable surg

149、eons to precisely position and fire the stapler.We have various staplers that can be used with our da Vinci 5,da Vinci X,and da Vinci Xi surgical systems:the SureForm 30,45,and 60 staplers,where the numeric designation indicates the length of the staple line.The SureForm 30,45,and 60 staplers are si

150、ngle-use,fully wristed,stapling instruments intended to be used in general,thoracic,gynecologic,urologic,and pediatric surgical procedures.The SureForm 30 stapler may deliver particular utility in thoracic procedures.The SureForm 45 stapler may receive particular use in thoracic and colorectal proce

151、dures where maneuverability and visualization are limited.The SureForm 60 stapler is intended to deliver particular value in bariatric procedures.Outside of the U.S.(“OUS”),we also offer the EndoWrist 30 and 45 staplers that can be used with our da Vinci X and da Vinci Xi surgical systems.The EndoWr

152、ist 30 stapler is intended to deliver particular utility with fine tissue interaction in lobectomy and other thoracic procedures.The EndoWrist 45 stapler is used in general,gynecologic,thoracic,and urologic surgical procedures.We also have various clearances for five stapler reloads:gray(2.0 mm),whi

153、te(2.5 mm),blue(3.5 mm),green(4.3 mm),and black(4.6 mm).Not all reloads are available for use on all staplers.Not all staplers or reloads are available in all countries.Da Vinci Energy.Our first-generation E-100 generator is offered as an upgrade to power our da Vinci Vessel Sealer Extend and Synchr

154、oSeal instruments.Additionally,we recently introduced our second-generation E-200 generator,an advanced electrosurgical generator designed to provide high-frequency energy for cutting,coagulation,and vessel sealing of tissues.The E-200 generator is integrated with the da Vinci 5 surgical system,is c

155、ompatible with our da Vinci X and Xi surgical systems,and can also function as a standalone electrosurgical generator.Vessel Sealer Extend is a single-use,fully wristed,advanced bipolar instrument that is compatible with our da Vinci 5,da Vinci X,and da Vinci Xi surgical systems.It is intended for g

156、rasping and blunt dissection of tissue,bipolar coagulation,and mechanical transection of vessels up to 7 mm in diameter and tissue bundles that fit in the jaws of the instrument.This instrument enables surgeons to control vessel sealing,while providing the benefits of robotic-assisted surgery,and is

157、 designed to enhance surgical efficiency and autonomy in a variety of general and gynecologic surgical procedures.SynchroSeal enables a surgeon to perform rapid,one-step sealing and transection with a single pedal press.SynchroSeal uses advanced bipolar energy from its raised cut electrode to transe

158、ct tissue and then cool down quickly.Accessory Products.We sell various accessory products,which are used in conjunction with the da Vinci surgical systems as surgical procedures are performed.Accessory products include sterile drapes used to help ensure a sterile field during surgery,vision product

159、s,such as replacement 3D stereo endoscopes,camera heads,and light guides,and other items that facilitate the use of the da Vinci surgical systems.Instruments and accessories are also used with our Ion endoluminal system to perform lung biopsy procedures and for the operation and maintenance of the s

160、ystem.Ion Instruments.Instruments utilized with our Ion system include our fully articulating catheter,which is employed to navigate the intricate and narrow airways of the lungs,our peripheral vision probe,an endoscope that provides real-time Table of Contents9airway visualization for catheter navi

161、gation,and our Flexision biopsy needles,which are used to procure tissue samples from lung nodules.Accessory Products.Accessory products that are used in conjunction with the Ion system include cleaning tools and other ancillary equipment essential for the operation and maintenance of the Ion system

162、.LearningIntuitive provides a progressive learning journey to support the use of our technology.These training pathways leverage both learning engagements and learning technologies.Learning engagement touchpoints vary by specific pathway,skill level,and interest,while learning technologies enable an

163、d provide training directly to the customer.The portfolio of learning offerings includes role-specific training pathways,learning engagements,and learning technology.Training Pathways.Intuitives training pathways provide a systematic learning journey that helps customers build technical proficiency.

164、There are pathways for surgeons and physicians,residents and fellows,OR care teams,patient side assists,and robotic coordinators,as well as recommendations for executives.Learning Engagements.Intuitive learning engagements are touchpoints that support customers throughout their learning journeys.The

165、y vary by pathway,skill level,and focus area.Engagements include case observations,online education,in-service training,simulation/skills training,OR care team training,technology training,reprocessing training,proctoring,advanced training,and curriculum development support.Many of these programs ta

166、ke place at Intuitive training centers and are taught by experienced Intuitive staff,while our advanced courses are taught by surgeon and physician instructors.Learning Technology.Learning technologies are designed to help customers access training.Enabling technology helps bring innovative offering

167、s to the customer.Intuitives enabling technologies include Telepresence and the Advanced Insights Suite(which includes Case Insights and Insights Engine).Learning technology solutions include Intuitive Learning,SimNow,customized training models,remote case observations,and remote proctoring.Two of t

168、he technology solutions most often used by customers are Intuitive Learning and SimNow.Intuitive Learning.Intuitive Learning enables customers to complete technology and procedure education,while also being able to view,assign,and track technology and simulation learning.Intuitive Learnings user rol

169、es include surgeons/physicians,residents/fellows,care teams,patient side assists,robotic coordinators,and sterile reprocessing staff.SimNow.Our cloud-enabled SimNow simulation platform is a practice tool that gives a user the opportunity to practice their skills and gain familiarity with the surgeon

170、 console controls and supports the users progressive learning pathway.SimNow incorporates 3D,physics-based computer simulation technology to immerse the user within a virtual environment and provides training capabilities that have been used extensively by surgeons.The user navigates through the env

171、ironment and completes exercises by controlling virtual instruments from the surgeon console.Upon completion of a skills exercise,the skills simulator provides a quantitative assessment of user performance based on a variety of task-specific metrics.The SimNow online connection drives real-time simu

172、lation performance tracking for surgeons and administrators through an online dashboard and supports remote updates of the VR content and 3DHD videos to drive a more interactive and engaging customer experience.SimNow is intended to augment,not replace,existing training programs for the da Vinci 5,d

173、a Vinci X,da Vinci Xi,and da Vinci SP surgical systems.ServicesWe have a network of field service engineers across the U.S.,Canada,Europe,and Asia and maintain relationships with various distributors around the globe.This infrastructure of service and support specialists offers a full complement of

174、services for our customers,including installation,repair,maintenance,24/7 technical support,and proactive system health monitoring.Our comprehensive support and program assistance helps ensure customers and care teams maximize program performance and protect their investment.Services include readine

175、ss support,maintenance support,perioperative consulting,Custom Hospital Analytics,and market consulting optimization.Readiness and Maintenance Support.Readiness support is operational support to ensure smooth onboarding and adoption of new systems and technology.Maintenance support helps to maximize

176、 operational efficiency and reduce unplanned equipment downtime.It includes service care plans,support teams,OnSite monitoring,software upgrades and updates,as well as a customer portal.The service plan portfolio offers flexible service plans to ensure reliability of the systems and instruments and

177、help optimize the robotics program.The support team of expert field service,remote technical support,and customer care agents resolve and prevent technology issues that could inhibit optimal utilization.OnSite monitoring offers remote service in real-time for pre-operative and intraoperative trouble

178、shooting,as well as proactive monitoring of system performance.Software upgrades and updates enable the latest product innovations,enhancements,and reliability improvements.The customer portal is an online tool that enables customers to access system utilization and program Table of Contents10analyt

179、ics,view orders and maintenance history,and initiate product returns and exchanges to help achieve the operational and financial goals of a robotics program.Perioperative Consulting.Perioperative consulting is a suite of customized solutions to improve a hospitals efficiency and performance with Int

180、uitive technologies.New system integration support is available to streamline the start-up process and expedite increased procedure volumes.Overall program assessments help to support efficiency improvements,cost reductions,and system access optimization.Program Analytics.Our Custom Hospital Analyti

181、cs program enables the integration of data sources so that individual health institutions can analyze their data in their own environment.Using this data,executives,administrators,care teams,and surgeons can gain alignment around their programs based on their KPIs,determine best practices,assess gap

182、s,and take actionable steps to address any gaps.Digital SolutionsIntegrated digital capabilities provide connected offerings,streamlining performance for hospitals with program-enhancing insights.Secure-by-design,cloud-enabled products analyze and simplify essential data to continuously optimize the

183、 use of time,tools,and techniques.Intuitive Hosted&Managed Services.The vast majority of our systems are network connected and directly communicate with Intuitive to enable proactive monitoring of product performance to provide high uptime reliability,as well as provide software updates and data ins

184、ights to Intuitive customers.3D Modeling Services.Intuitive 3D Models is our augmented reality imaging product for use in kidney,prostate,lung,and rectal procedures.The service extracts CT and MR scans,runs them through segmentation algorithms and,after technicians revision and radiologists review,r

185、eturns a 3D segmented model of the organ for use in planning for a procedure,intraoperative visualization,and surgical education.The tool uses augmented reality to give surgeons an image with details of organ anatomy blood vessels,tumor shape,and size that they may not be able to see well with other

186、 two-dimensional imaging.Intuitive designed this to help with pre-operative planning and intraoperative guidance to let surgeons know where critical anatomy sits as they work through a procedure,as well as to be shared as a teaching tool for other physicians and patients.The product has recently bee

187、n launched,and we are in the process of bringing the first sites onboard.My Intuitive.This mobile and web application was developed to be the single point for Intuitive customers to access individual or program-level data from Intuitive.The application also offers comparisons of those insights with

188、anonymized national benchmarks to help drive operational efficiencies and decreased costs.It enables mobile access to Intuitives Learning platform,case reports generated automatically for the surgeon,and an ability for surgeons to publish their practice information online for patients seeking local

189、physicians.Intuitive Hub.Intuitive Hub is an OR informatics platform that integrates multiple applications and data sets to help orchestrate medical procedure workflows.For the care team,Intuitive Hub acts as a point-of-care device that automates tasks,such as video recording and bookmarking.The Int

190、uitive Telepresence application on Hub can be used to facilitate peer-to-peer collaboration,learning,and support.Video captured during surgery and da Vinci system data are connected via Intuitive Hub for physicians to access after a surgical procedure,helping to facilitate personalized learning and

191、increase efficiency.Business StrategyWe align our goals to those of our customers,often called the Quintuple Aim:enabling physicians and hospitals to improve outcomes for their patients,improve their patients experience,improve the care teams experience,address barriers to expanding access to high q

192、uality minimally invasive care,and lower the total cost to treat per patient episode.Through the use of Intuitives smart,connected systems,robotic technologies,advanced imaging,and informatics,our objective is to create value for patients,physicians,and hospitals,as summarized below.Patient Value.We

193、 believe that the value of a medical procedure to a patient can be defined:Patient Value=Procedure Efficacy/Invasiveness.We define procedure efficacy as a measure of the success of the procedure in helping resolve the underlying disease,and invasiveness as a measure of patient pain and disruption of

194、 regular activities.When the patient value of a procedure using an Intuitive product is greater than that of alternative intervention options,patients may benefit from seeking out physicians and hospitals that offer those products,which could potentially result in a local market share shift.Adoption

195、 of Intuitive technology occurs by procedure and by market and is driven by the relative patient value and the total intervention costs of da Vinci and Ion procedures as compared to alternative intervention options for the same disease state or condition.We believe that most patients will place a hi

196、gher value on procedures that are not only more efficacious but also less invasive than alternative interventions.Our goal is to provide products to Table of Contents11physicians who,in turn,provide patients with procedure options that are both highly effective and less invasive than others.Furtherm

197、ore,we will work to increase access to minimally invasive care.Physician Value.We offer physicians and their operating room staff training on the technical use of our products.Our da Vinci surgical system provides an ergonomic platform for surgeons to perform their procedures.We seek to provide surg

198、eons with reliable and easy-to-use products.For example,the change to cloud-based analytics and routine use of local analytics may help surgeons track their procedures and processes and,with a network-connected smartphone and the My Intuitive app,surgeons can access and explore their procedure data,

199、such as console time and instrument usage,to gain insights into their program.Ion brings physicians an immersive bronchoscopy experience from visualizing the lung anatomy and planning each patients procedure to navigating and biopsying small nodules in the peripheral lung.Results from early studies

200、have demonstrated relatively low occurrence of pneumothorax requiring intervention.Hospital Value.We help hospitals build value by increasing surgical revenue and reducing costs through lower complication rates and reduced lengths of patient stay.For example,we believe robotic-assisted surgery with

201、the da Vinci surgical system is a cost-effective approach to many surgeries as compared to alternative treatment options,as recognized in many published studies.We also offer our Custom Hospital Analytics program,which enables the integration of data sources so that individual health institutions ca

202、n analyze their data in their own environment.Using this data,administrators,chiefs of surgery,and surgeons can gain alignment around their programs based on their KPIs,determine best practices,assess gaps,and take actionable steps to address any gaps.Clinical ApplicationsWe are the beneficiaries of

203、 productive collaborations with leading surgeons in exploring and developing new techniques and applications for robotic-assisted surgery with the da Vinci surgical system and minimally invasive biopsies with the Ion endoluminal systeman important part of our creative process.We primarily focus our

204、development efforts on those procedures in which we believe our products bring the highest patient value,surgeon value,and hospital value.We currently focus on five surgical specialties:general surgery,urologic surgery,gynecologic surgery,cardiothoracic surgery,and head and neck surgery.Key procedur

205、es that we are focused on include hernia repair,colon and rectal procedures,cholecystectomy,bariatric surgery,prostatectomy,partial nephrectomy,hysterectomy,sacrocolpopexy,lobectomy,and transoral robotic surgery.We also focus on minimally invasive biopsies in the lung.Representative surgical applica

206、tions are described below.General SurgeryHernia Repair.A hernia occurs when an organ or other tissue squeezes through a weak spot in a surrounding muscle or connective tissue.During a hernia repair surgery,the weakened tissue is secured,and defects are repaired.Common types of hernias are ventral an

207、d inguinal.Ventral,or abdominal hernia,may occur through a scar after surgery in the abdomen.Inguinal hernia is a bulge in the groin and is more common in men.Hernia repair can be performed using traditional open surgery or MIS.There is a wide range of complexity in hernia repair surgeries and varyi

208、ng surgeon opinions regarding optimal surgical approach.The benefits of minimally invasive and robotic-assisted hernia repair surgery vary by patient.Colorectal Surgery.These procedures typically involve benign or cancerous conditions of the lower digestive system,in particular the rectum or colon.C

209、ommon procedures in this area include hemicolectomy,sigmoidectomy,low anterior resection,and abdominoperineal resection.Surgeons have reported that the use of robotic-assisted surgery with a da Vinci surgical system and our latest technologies,such as the SureForm stapler and da Vinci energy product

210、s,has enabled them to offer MIS approaches to a broader range of colorectal surgery patients.Cholecystectomy.Cholecystectomy,or the surgical removal of the gallbladder,is a commonly performed general surgery procedure.Cholecystectomy is the primary method for the treatment of gallstones and other ga

211、llbladder diseases.Most cholecystectomies are performed using multi-port MIS techniques,although some surgeons choose to perform cholecystectomy using manual single-port instrumentation.Firefly technology can be used to visualize biliary anatomy in three dimensions beneath the tissue surfaces during

212、 multi-port da Vinci cholecystectomies.Bariatric Surgery.A body of literature points to the benefit of surgery to treat patients with morbid obesity and its secondary effects,such as diabetes.Sleeve gastrectomy and Roux-en-Y gastric bypass(“RYGB”)are commonly performed surgical procedures for morbid

213、 obesity in the U.S.The body habitus of morbidly obese patients can make laparoscopic surgery physically challenging for the surgeon,and certain surgeons have found value in using the da Vinci surgical system to improve upon the ergonomics when performing MIS in morbidly obese patients.In addition,R

214、YGB can be a technically challenging procedure due to the suturing,stapling,and tissue(bowel)manipulation that is required.Surgeons using the da Vinci surgical system have reported a reduction in a critical complication(anastomotic leaks)relative to laparoscopic RYGB.Also,we believe SureForm 60 may

215、have particular utility in bariatric procedures.Table of Contents12Urologic SurgeryProstatectomy.Radical prostatectomy is the removal of the prostate gland in patients diagnosed with clinically localized prostate cancer.The standard approach to the removal of the prostate was via an open surgical pr

216、ocedure.The conventional laparoscopic approach is an option,but it is difficult and poses challenges to even the most skilled urologist.The da Vinci surgical system has enabled a large number of surgeons to convert from using an open surgical technique to a minimally invasive technique.Partial Nephr

217、ectomy.Partial nephrectomy is the removal of a small portion of a kidney(typically,an area of the kidney containing a tumor).Partial nephrectomies are most commonly performed in patients diagnosed with clinically localized renal cancer.Excluding robotic-assisted surgery with a da Vinci surgical syst

218、em,there are three common surgical approaches to performing partial nephrectomies:open surgical technique,laparoscopy,and hand-assisted laparoscopy,which is a hybrid of the open and laparoscopic techniques.Surgeons have reported that the da Vinci surgical systems capabilities may enable a large numb

219、er of these procedures to be performed through a minimally invasive technique,conferring the benefits of MIS to a broader range of partial nephrectomy patients.Treatment guidelines for patients with localized renal cancer recommend partial nephrectomy due to the benefits that nephron-sparing surgery

220、 has in long-term patient outcomes.Published clinical literature has shown that the presence of a da Vinci surgical system is associated with a higher-proportion of patients receiving a guideline-recommended partial nephrectomy.Gynecologic SurgeryHysterectomy.Removal of the uterus is one of the most

221、 commonly performed surgeries in gynecology and is performed for a variety of underlying benign and cancerous conditions.Hysterectomies can be performed using open surgery(laparotomy)or MIS techniques,which include vaginal,laparoscopic,and robotic-assisted approaches.Prior to the clearance of the da

222、 Vinci surgical system for use in gynecological procedures in 2005,the majority of hysterectomies performed were open surgeries.We believe that robotic-assisted surgery with the da Vinci surgical system provides patients the opportunity to receive a minimally invasive treatment as an alternative to

223、an open hysterectomy.Sacrocolpopexy.The abdominal(open)sacrocolpopexy is one of the operations performed to treat vaginal vault prolapse.Sacrocolpopexy involves suturing a synthetic mesh that connects and supports the vagina to the sacrum(tailbone).A sacrocolpopexy can be performed using a conventio

224、nal laparoscopic technique;however,it is generally described as difficult and cumbersome to perform.Surgeons have reported that the da Vinci surgical systems capabilities may enable a larger number of these procedures to be performed through a minimally invasive technique,conferring the benefits of

225、MIS to a broader range of sacrocolpopexy patients.Cardiothoracic SurgeryThoracic Surgery.Conventional approaches to surgical procedures in the thorax include both open and video-assisted thoracoscopic approaches.Procedures performed via these methods include pulmonary wedge resection,pulmonary lobec

226、tomy,thymectomy,mediastinal mass excision,and esophagectomy.Many thoracic procedures remain open procedures.Surgeons have reported that the use of robotic-assisted surgery with a da Vinci surgical system in thoracic surgery has enabled them to offer MIS approaches to a broader range of thoracic surg

227、ery patients and improved clinical outcomes compared to open and video-assisted thoracic surgery in published single-center,multi-center,and national database clinical studies.Also,we believe the EndoWrist 30 stapler and the SureForm 30 stapler may have particular utility in thoracic procedures.Head

228、 and Neck SurgeryTransoral Surgery.Head and neck cancers are typically treated by either surgical resection or chemo-radiation,or a combination of both.Surgical resection performed by an open approach may require a“jaw-splitting”mandibulotomy.This procedure,while effective in treating cancer,is pote

229、ntially traumatic and disfiguring to the patient.MIS approaches via the mouth(transoral surgery)are challenged by line-of-sight limitations dictated by conventional endoscopic tools.Chemo-radiation as a primary therapy does allow patients to avoid traumatic surgical incisions;however,the literature

230、suggests that this modality diminishes patients ability to speak and swallow normally.Surgeons have reported that da Vinci transoral surgery allows them to operate on tumors occurring in the oropharynx(i.e.,tonsil and base of tongue)and larynx via the mouth and to overcome some of the line-of-sight

231、limitations of conventional transoral surgery.Da Vinci Procedure MixOur da Vinci procedure business is broadly split into two categories:(1)cancer procedures and(2)procedures for benign conditions.Cancer and other highly complex procedures tend to be reimbursed at higher rates than less complex proc

232、edures for benign conditions.Thus,hospitals are more sensitive to the costs associated with treating less complex,benign conditions.Our strategy is to provide hospitals with attractive clinical and economical solutions across the spectrum of procedure complexity.Our fully featured da Vinci 5 and da

233、Vinci Xi surgical systems with advanced instruments(including the da Vinci energy and Table of Contents13da Vinci stapler products)and our Integrated Table Motion product target the more complex procedure segment.Our da Vinci X surgical system is targeted toward price-sensitive markets and procedure

234、s.Our da Vinci SP surgical system complements our da Vinci 5,da Vinci X,and Xi surgical systems by enabling surgeons to access narrow workspaces.Clinical SummaryThere are over 70 representative clinical uses for da Vinci surgical systems.We believe that there are numerous additional applications tha

235、t can be addressed with the da Vinci surgical system,and we work closely with our surgeon customers to refine and explore new techniques in which a da Vinci surgical system may bring value.As of December 31,2024,we had an installed base of 9,902 da Vinci surgical systems,including 5,807 in the U.S.,

236、1,867 in Europe,1,745 in Asia,and 483 in the rest of the world.We estimate that surgeons using our technology completed approximately 2,683,000 surgical procedures of various types in hospitals throughout the world during the year ended December 31,2024.Additionally,over time,we believe that there a

237、re numerous additional applications that can be addressed with our Ion endoluminal system.As of December 31,2024,we had an installed base of 805 Ion systems,784 of which are located in the U.S.We plan to seek additional clearances,certifications,or approvals for Ion in OUS markets over time.Sales an

238、d Customer SupportSales ModelWe provide our products through direct sales organizations in the U.S.,Europe(excluding Spain,Portugal,Italy,Greece,and Eastern European countries),China,Japan,South Korea,India,Taiwan,and Canada.We provide products and services in China through our majority-owned joint

239、venture(“Joint Venture”)with Shanghai Fosun Pharmaceutical(Group)Co.,Ltd.(“Fosun Pharma”)and its affiliates.See“Item 7.Managements Discussion and Analysis of Financial Condition and Results of Operations”for further details on the Joint Venture.In the remainder of our markets outside of the U.S.,we

240、provide our products through distributors.During the years ended December 31,2024,2023,and 2022,domestic revenue accounted for 67%,66%,and 67%,respectively,of total revenue,while revenue from our OUS markets accounted for 33%,34%,and 33%,respectively,of total revenue.Our direct sales organization is

241、 composed of a capital sales team,responsible for selling systems,and a clinical sales team,responsible for supporting the systems used in procedures performed at our hospital accounts.Our hospital accounts include both individual hospitals and healthcare facilities as well as hospitals and healthca

242、re facilities that are part of an integrated delivery network(“IDN groups”).The initial system sale into an account is a major capital equipment purchase by our customers and typically has a lengthy sales cycle that can be affected by macroeconomic factors,capital spending prioritization,the timing

243、of budgeting cycles,and the evaluation of alternative products.Capital sales activities include educating surgeons or physicians and hospital staff across multiple specialties on the benefits of robotic-assisted surgery with a da Vinci surgical system or robotic-assisted bronchoscopy with an Ion end

244、oluminal system,total treatment costs,and the clinical applications that our technology enables.We also train our sales organization to educate hospital management on the potential benefits of adopting our technology,including the clinical benefits of robotic-assisted surgery with a da Vinci surgica

245、l system or robotic-assisted bronchoscopy with an Ion endoluminal system,in support of their Quintuple Aim objectives.Our clinical sales team works on site at hospitals,interacting with surgeons or physicians,operating room staff,and hospital administrators to develop and sustain successful robotic-

246、assisted surgery or bronchoscopy programs.They assist the hospital in identifying surgeons or physicians who have an interest in robotic-assisted surgery or bronchoscopy and the potential benefits provided by the da Vinci surgical system and the Ion endoluminal system.Our clinical sales team provide

247、s current clinical information on robotic-assisted surgery or bronchoscopy practices and new product applications to the hospital teams.Our clinical sales team has grown with the expanded installed bases of da Vinci surgical systems and Ion endoluminal systems as well as the total number of procedur

248、es performed.We expect this organization to continue to grow as our business expands.Our customers place orders to replenish their supplies of instruments and accessories on a regular basis.Orders received are typically shipped within one business day.New direct customers who purchase a system typic

249、ally place an initial stocking order of instruments and accessories soon after they receive their system.Our business is subject to seasonal fluctuations.Historically,placements of our da Vinci surgical systems have tended to be heavier in the fourth quarter and lighter in the first quarter,as hospi

250、tal budgets are reset.In addition,we have historically experienced lower procedure volume in the first and third quarters and higher procedure volume in the second and fourth quarters.More than half of da Vinci procedures performed are for benign conditions.These benign procedures and other short-te

251、rm elective procedures tend to be more seasonal than cancer procedures and surgeries for other life-threatening conditions.In the U.S.,volumes for procedures associated with benign conditions are typically seasonally higher in the fourth quarter when more patients have met annual deductibles and low

252、er in the first quarter when deductibles are reset.Seasonality outside of the U.S.varies and is more pronounced around local holidays and vacation periods,which have lower procedure volume.The Table of Contents14timing of procedures and changes in procedure volume impact the timing of instruments an

253、d accessories and capital purchases.As a result of factors outlined in“Item 7.Managements Discussion and Analysis of Financial Condition and Results of OperationsCOVID-19 Pandemic”below,including the past and potential future recommendations of authorities to defer elective procedures,historical pro

254、cedure patterns have been and may continue to be disrupted.Customer SupportWe have a network of field service and technical support engineers across the U.S.,Canada,Europe,and Asia and maintain relationships with various distributors around the globe.This infrastructure of service and support specia

255、lists,along with advanced service tools and solutions,offers a full complement of services for our customers,including installation,repair,maintenance,24/7 technical support,and proactive system health monitoring.We generate service revenue by providing these services to our customers through compre

256、hensive service contracts and time and material programs.Research and DevelopmentWe focus our research and development efforts on innovation and improvement for products and services that align with our mission:We believe that minimally invasive care is life-enhancing care.Through ingenuity and inte

257、lligent technology,we believe that we can expand the potential of physicians to heal without constraints.We employ engineering and research and development staff to focus on delivering future innovations and sustaining improvements that advance our mission.In certain instances,we complement our rese

258、arch and development effort through collaborations with other companies,such as our Integrated Table Motion product offering developed with Hillrom(now a part of Baxter International Inc.).ManufacturingWe manufacture our systems at our facilities in Sunnyvale,California,and Peachtree Corners,Georgia

259、,as well as at our Joint Ventures facility in Shanghai,China.Our instruments and accessories are produced at our facilities in Sunnyvale,California,and Mexicali,Mexico.Additionally,we have Ion-related manufacturing in Blacksburg,Virginia,and Shanghai,China,and endoscope-related manufacturing at mult

260、iple sites in Germany.We are also planning to open a new manufacturing facility in Bulgaria.We purchase both custom and off-the-shelf components from a large number of suppliers and subject them to stringent quality specifications and processes.Some of the components necessary for the assembly of ou

261、r products are currently provided to us by sole-sourced suppliers(the only recognized supply source available to us)or single-sourced suppliers(the only approved supply source for us among other sources).We purchase the majority of our components and major assemblies through purchase orders rather t

262、han long-term supply agreements and generally do not maintain large volumes of finished goods relative to our anticipated demand.CompetitionWe face competition in the forms of existing open surgery,conventional MIS,drug therapies,radiation treatment,and other emerging diagnostic and interventional s

263、urgical approaches.Some of these procedures are widely accepted in the medical community and,in many cases,have a long history of use.Our success depends on continued clinical and technical innovation,quality,and reliability,as well as educating hospitals,surgeons,and patients on the demonstrated re

264、sults associated with robotic-assisted medical procedures using da Vinci surgical systems or Ion endoluminal systems and their value relative to other techniques.We also face competition from several companies that have introduced or are developing new approaches and products for the MIS market.We b

265、elieve that the entrance or emergence of competition validates MIS and robotic-assisted surgery or robotic-assisted bronchoscopy.Moreover,as we add new robotically controlled products(e.g.,da Vinci stapling and da Vinci energy products)that compete with product offerings traditionally within the dom

266、ains of open surgery and/or conventional MIS,we face greater competition from larger and well-established companies,such as Johnson&Johnson and Medtronic plc.Additionally,we currently face,or anticipate facing,competition from companies with products used in open or MIS surgeries,including laparosco

267、py and alternative multi-port,single-port,or endoluminal systems.We also compete with companies providing other therapeutic approaches for addressing target clinical conditions,as well as companies developing diagnostic solutions that could serve as alternatives to current or planned Intuitive offer

268、ings.Companies that have introduced products in the field of robotic-assisted medical procedures,or have made explicit statements about their efforts to enter the field,include,but are not limited to,the following:Beijing Surgerii Robotics Company Limited;CMR Surgical Ltd.;Distalmotion SA;Harbin Siz

269、he Rui Intelligent Medical Equipment Co.,Ltd.;Johnson&Johnson;Karl Storz SE&Co.KG;Medicaroid Corporation;Medtronic plc;meerecompany Inc.;Noah Medical;Shandong Weigao Group Medical Polymer Company Ltd.;Shanghai Microport Medbot(Group)Co.,Ltd.;Shenzhen Edge Medical Co.,Ltd.;and SS Innovations Internat

270、ional,Inc.Other companies with substantial experience in industrial robotics could potentially expand into the field of medical robotics and become a competitor.In addition,research efforts utilizing computers and robotics for medical procedures Table of Contents15are underway at various companies a

271、nd research institutions.Our revenues may be adversely impacted as our competitors announce their intent to enter our markets and as our customers anticipate the availability of competing products.We may not be able to maintain or improve our competitive position against current or potential competi

272、tors,especially those with greater resources.Intellectual PropertyWe place considerable importance on obtaining and maintaining patent,copyright,trademark,and trade secret protection for significant new technologies,products,and processes.We generally rely upon a combination of intellectual property

273、 laws,confidentiality procedures,and contractual provisions to protect our proprietary technology.For example,we have trademarks,both registered and unregistered,that provide distinctive identification of our products in the marketplace.We also have exclusive and non-exclusive patent licenses with v

274、arious third parties to supplement our own robust patent portfolio.As of December 31,2024,we owned more than 5,300 patents granted and still in force and more than 2,400 patents pending worldwide.We intend to continue filing new patent applications in the U.S.and foreign jurisdictions to seek protec

275、tion for our technology.Patents have finite terms.The expiration of a patent ends the exclusive rights accorded by the patent for the invention claimed.Government RegulationOur products and operations are subject to regulation in the U.S.by the FDA and the State of California as well as by other cou

276、ntries and regions in which we market and promote our products.In addition,our products must meet the requirements of a large and growing body of international regulations and standards,which govern the design,manufacture,materials content and sourcing,testing,certification,packaging,installation,us

277、e,and disposal of our products.We must continually keep abreast of these regulations,standards,and requirements and integrate our compliance into the development and regulatory documentation for our products.Failure to meet these requirements could limit our ability to market our products in those r

278、egions that require compliance with such regulations and standards.Examples of standards to which we are subject include electrical safety standards,such as those of the International Electrotechnical Commission(e.g.,IEC 60601-ss series of standards),and composition regulations,such as the Reduction

279、 of Hazardous Substances(“RoHS”)and the Waste Electrical and Electronic Equipment(“WEEE”)Directives applicable in the European Union(“EU”).U.S.RegulationFDAOur products are subject to regulation as medical devices in the United States under the Federal Food,Drug,and Cosmetic Act(“FFDCA”),as implemen

280、ted and enforced by the FDA.The FDA regulates the development,design,non-clinical and clinical research,manufacturing,safety,efficacy,labeling,packaging,storage,installation,recordkeeping,complaint and adverse event reporting,clearance,approval,certification,promotion,marketing,export,import distrib

281、ution,and service of medical devices in the U.S.to ensure that medical devices distributed domestically are safe and effective for their intended uses.Under the FFDCA,medical devices are classified into one of three classesClass I,Class II,or Class IIIdepending on the degree of risk associated with

282、each medical device and the extent of control needed to ensure safety and effectiveness.Our current products are Class II medical devices.Class II medical devices are those that are subject to general controls,and most require premarket demonstration of adherence to certain performance standards or

283、other special controls,as specified by the FDA,and special controls as deemed necessary by the FDA to ensure the safety and effectiveness of the device.These special controls can include performance standards,post-market surveillance,patient registries,and FDA guidance documents.Manufacturers of mos

284、t Class II devices are required to submit to the FDA a premarket notification under Section 510(k)of the FFDCA requesting authorization to commercially distribute the device.The FDAs authorization to commercially distribute a device subject to a 510(k)premarket notification is generally known as 510

285、(k)clearance.Our current products are subject to premarket notification and clearance under section 510(k)of the FFDCA.To obtain 510(k)clearance,we must submit to the FDA a premarket notification submission demonstrating that the proposed device is“substantially equivalent”to a legally marketed pred

286、icate device.The FDA may require additional information,including clinical data,to make a determination regarding substantial equivalence.In addition,the FDA collects user fees for certain medical device submissions and annual fees for medical device establishments.If the FDA agrees that the device

287、is substantially equivalent to a predicate device,it will grant clearance to commercially market the device in the U.S.The FDA has a statutory 90-day period to respond to a 510(k)submission;however,as a practical Table of Contents16matter,clearance often takes longer.The FDA may require further info

288、rmation,including clinical data,to make a determination regarding substantial equivalence.If the FDA determines that the device,or its intended use,is not“substantially equivalent,”the device may be designated as a Class III device.The device sponsor must then fulfill more rigorous PMA requirements

289、or can request a risk-based classification determination for the device in accordance with the de novo classification pathway,which is a route to market for novel medical devices that are low to moderate risk and are not substantially equivalent to a predicate device.The PMA process is more demandin

290、g than the 510(k)premarket notification process.In a PMA application,the manufacturer must demonstrate that the device is safe and effective,and the PMA application must be supported by extensive data,including data from preclinical studies and human clinical trials.The FDA,by statute and regulation

291、,has 180 days to review a PMA application,although the review more often occurs over a significantly longer period of time and can take up to several years.In approving a PMA application or clearing a 510(k)submission,the FDA may also require some additional manufacturing controls,design control act

292、ivities and approvals,as well as specific post-market surveillance requirements when necessary to protect the public health or to provide additional safety and effectiveness data for the device.In such cases,the manufacturer might be required to follow certain patient groups for a number of years an

293、d make periodic reports to the FDA on the clinical status of those patients.Clinical trials are almost always required to support a PMA or de novo request and are sometimes required to support a 510(k)submission.All clinical investigations designed to determine the safety and effectiveness of a medi

294、cal device must be conducted in accordance with the FDAs investigational device exemption(“IDE”)regulations,which govern investigational device labeling,prohibit the promotion of the investigational device,and specify an array of recordkeeping,reporting and monitoring responsibilities of study spons

295、ors and study investigators.Regardless of the degree of risk presented by the medical device,clinical studies must be approved by,and conducted under the oversight of,an Institutional Review Board(“IRB”)for each clinical site.During a study,the sponsor is required to comply with the applicable FDA r

296、equirements,including,for example,trial monitoring,selecting clinical investigators and providing them with the investigational plan,ensuring IRB review,adverse event reporting,record keeping,and prohibitions on the promotion of investigational devices or on making safety or effectiveness claims for

297、 them.The clinical investigators in the clinical study are also subject to the FDAs regulations and must obtain patient informed consent,rigorously follow the investigational plan and study protocol,control the disposition of the investigational device,and comply with all reporting and recordkeeping

298、 requirements.Additionally,after a trial begins,we,the FDA,or the IRB could suspend or terminate a clinical trial at any time for various reasons,including a belief that the risks to study subjects outweigh the anticipated benefits.After a device receives 510(k)clearance,any modification that could

299、significantly affect its safety or effectiveness,or that would constitute a major change or modification in its intended use,will require a new 510(k)clearance or,depending on the modification,PMA approval or de novo classification.The FDA requires each manufacturer to determine whether a proposed c

300、hange requires submission of a 510(k),de novo classification,or a PMA or PMA supplement in the first instance,but the FDA can review any such decision and disagree with a manufacturers determination.If the FDA disagrees with a manufacturers determination,the FDA can require the manufacturer to cease

301、 marketing and/or request the recall of the modified device until it receives the appropriate marketing authorization.Also,in these circumstances,the manufacturer may be subject to significant regulatory fines or penalties.In addition,the FDA may place significant limitations upon the intended use o

302、f our products as a condition of granting marketing authorization.Moreover,after a device is placed on the market,numerous FDA and other regulatory requirements continue to apply.These requirements include establishment registration and device listing with the FDA;compliance with medical device repo

303、rting regulations,which require that manufacturers report to the FDA if their device caused or contributed,or may have caused or contributed,to a death or serious injury or malfunctioned in a way that would likely cause or contribute to a death or serious injury if it were to recur;compliance with c

304、orrections and removal reporting regulations,which require that manufacturers report to the FDA field corrections and product recalls or removals if undertaken to reduce a risk to health posed by the device or to remedy a violation of the FFDCA that may present a risk to health;the FDAs recall autho

305、rity,whereby the agency can order device manufacturers to recall from the market a product that is in violation of governing laws and regulations;and post-market surveillance activities and regulations,which apply when deemed by the FDA to be necessary to protect the public health or to provide addi

306、tional safety and effectiveness data for the device.In addition,the FDA and the Federal Trade Commission also regulate the advertising and promotion of our products to ensure that the claims we make are consistent with our regulatory clearances,that there is scientific data to substantiate the claim

307、s,and that our advertising is neither false nor misleading.In general,we may not promote or advertise our products for uses not within the scope of our intended use statement in our clearances or make unsupported safety and effectiveness claims.Our manufacturing processes are required to comply with

308、 the Quality System Regulation(“QSR”).The QSR covers,among other things,the methods used in,and the facilities and controls used for,the design,testing,controlling,documenting,manufacture,packaging,labeling,storage,installation,and servicing of all medical devices intended for human use.The QSR also

309、 requires maintenance of extensive records,which demonstrate compliance with the FDA regulation,the manufacturers Table of Contents17own procedures,specifications,and testing,as well as distribution and post-market experience.Compliance with the QSR is necessary for a manufacturer to be able to cont

310、inue to market cleared or approved product offerings in the U.S.A companys facilities,records,and manufacturing processes are subject to periodic scheduled or unscheduled inspections by the FDA.Failure to maintain compliance with applicable QSR requirements could result in the shut-down of,or restri

311、ctions on,manufacturing operations and the recall or seizure of marketed products.If the FDA determines that a manufacturer has failed to comply with applicable regulatory requirements,it can take a variety of compliance or enforcement actions,which may result in any of the following sanctions:warni

312、ng letters,untitled letters,fines,injunctions,consent decrees,administrative penalties,and civil or criminal penalties;recalls,withdrawals,or administrative detention or seizure of our products;operating restrictions or partial suspension or total shutdown of production;refusing or delaying requests

313、 for 510(k)marketing clearance or PMA approvals of new products or modified products;withdrawing 510(k)clearances or PMA approvals that have already been granted;refusal to grant export approvals for our products;orcriminal prosecution.In addition,the discovery of previously unknown problems with an

314、y marketed products,including unanticipated adverse events or adverse events of increasing severity or frequency,whether resulting from the use of the device within the scope of its clearance or off-label by a physician in the practice of medicine,could result in restrictions on the device,including

315、 the removal of the product from the market or voluntary or mandatory device recalls.Products manufactured outside of the U.S.by or for us are subject to U.S.Customs and FDA inspection upon entry into the U.S.We must demonstrate compliance of such products with U.S.regulations and carefully document

316、 the eventual distribution or re-exportation of such products.Failure to comply with all applicable regulations could prevent us from having access to products or components critical to the manufacture of finished products and lead to shortages and delays.Other Healthcare Regulatory LawsWe are subje

317、ct to broadly applicable fraud and abuse and other healthcare laws and regulations that may constrain the business or financial arrangements and relationships through which we research,market,sell and distribute our products.Restrictions under applicable federal and state healthcare laws and regulat

318、ions,include the following:the federal Anti-Kickback Statute,which prohibits,among other things,individuals and entities from knowingly and willfully soliciting,offering,receiving or providing remuneration,directly or indirectly,in cash or in kind,to induce or reward,or in return for,either the refe

319、rral of an individual for,or the purchase,order or recommendation of,any good or service,for which payment may be made,in whole or in part,under a federal and state healthcare program such as Medicare and Medicaid.A person or entity does not need to have actual knowledge of the statute or specific i

320、ntent to violate it in order to have committed a violation;the federal criminal and civil false claims laws,including the federal False Claims Act,which can be enforced through civil whistleblower or qui tam actions against individuals or entities,and the Federal Civil Monetary Penalties Laws,which

321、prohibit,among other things,knowingly presenting,or causing to be presented,to the federal government,claims for payment that are false or fraudulent,knowingly making,using or causing to be made or used,a false record or statement material to a false or fraudulent claim,or from knowingly making a fa

322、lse statement to avoid,decrease or conceal an obligation to pay money to the federal government.In addition,certain marketing practices,including off-label promotion,may also violate false claims laws.Moreover,the government may assert that a claim including items and services resulting from a viola

323、tion of the federal Anti-Kickback Statute constitutes a false or fraudulent claim for purposes of the federal False Claims Act;the Health Insurance Portability and Accountability Act(“HIPAA”),which imposes criminal and civil liability,prohibits,among other things,knowingly and willfully executing,or

324、 attempting to execute a scheme to defraud any healthcare benefit program,or knowingly and willfully falsifying,concealing or covering up a material fact or making any materially false statement in connection with the delivery of or payment for healthcare benefits,items or services;similar to the fe

325、deral Anti-Kickback Statute,a person or entity does not need to have actual knowledge of the statute or specific intent to violate it in order to have committed a violation;Table of Contents18the Physician Payments Sunshine Act,which requires certain manufacturers of covered drugs,devices,biologics,

326、and medical supplies that are reimbursable under Medicare,Medicaid,or the Childrens Health Insurance Program,with certain exceptions,to report annually to the Centers for Medicare&Medicaid Services(“CMS”)information on certain payments and other transfers of value to physicians(defined to include do

327、ctors,dentists,optometrists,podiatrists,and chiropractors),teaching hospitals,and certain other health care providers(such as physician assistants and nurse practitioners),as well as ownership and investment interests held by physicians and their immediate family members;analogous state and foreign

328、laws and regulations,such as state anti-kickback and false claims laws,which may apply to sales or marketing arrangements and claims involving healthcare items or services reimbursed by non-governmental third-party payors,including private insurers;andcertain state laws that require medical device m

329、anufacturers to comply with the industrys voluntary compliance guidelines and the relevant compliance guidance promulgated by the federal government in addition to requiring such manufacturers to report information related to payments to clinicians and other healthcare providers or marketing expendi

330、tures.Violations of any of these laws may result in significant penalties,including but not limited to the following:civil,criminal,and administrative penalties;damages;fines;disgorgement;imprisonment;the curtailment or restructuring of operations;loss of eligibility to obtain approvals from the FDA

331、;exclusion from participation in government contracting,healthcare reimbursement,or other government programs,including Medicare and Medicaid;integrity oversight and reporting obligations;or reputational harm.Foreign RegulationIn order for us to market our products in countries outside the United St

332、ates,we must obtain regulatory approvals or certifications and comply with extensive product quality system and composition regulations in other countries.These regulations,including the requirements for approvals,clearance,or certifications and the time required for regulatory review,vary from coun

333、try to country.Some countries have regulatory review processes that are substantially longer than U.S.processes.Failure to obtain regulatory approval or certification in a timely manner and meet all of the local requirements,including language and specific safety standards,in any foreign country in which we plan to market our products could prevent us from marketing products in such countries or s